Ashes blow for Barmy Army as pound is bowled out by currency markets

An England fan at the Ashes Test in Adelaide in 2006. Photograph: Julian Finney/Getty Images

Win or lose on the field, England's Barmy Army of travelling cricket fans are in for a nasty shock on this winter's Ashes tour in Australia. Once disparaged as the "Pacific peso", the Australian dollar rocketed on Friday and a pound is now worth just A$1.60, compared with more than $2 last year.

The renaissance of the Australian dollar over the past three months – it is now worth more than the US dollar for the first time since it was floated in 1983 – has eclipsed the performance of other fancied currencies, including the Japanese yen, the Swiss franc and the Chinese yuan. It could hardly come at a worse time for cricket enthusiasts making final preparations for England's tour, which begins in Perth on 5 November with a game against Western Australia.

Four years ago, 30,000 British fans travelled to Australia to watch a five-nil drubbing in the Ashes series. For fans making the journey this time, the cost in exchange-rate terms will be as much as 36% higher. David Swann, a currency strategist at Travelex, said that £500 would have bought A$1,250 at the start of the last Ashes season in Australia, but is now worth just A$805.

"That's a really significant shift," said Swann, who pointed to quantitative easing by central banks in Britain and the US as a reason for their currencies slipping. "The US has come out and said that it is going to extend its quantitative easing programme. That sends a message to people that the American economy is in trouble and they should go elsewhere."

Dave Peacock, one of the founding members of the Barmy Army, believes English fans will not be put off. "The dollar might be lot stronger but the Australian team is nowhere near as strong as it was four years ago and our team is on the way up. This is probably the best opportunity we've had since 1986-87."

But Peacock admitted that their partying may be curtailed. "People aren't going to like paying £5 a pint. I think they will still go to Australia, but maybe cut down on a couple of pints a night. In every city in Australia we've organised pubs that will be the party pub for that city."

The rate of exchange also means pricier hotels, meals, transport and even match tickets for travelling fans but for Australians heading abroad the currency surge is good news. The country's national airline, Qantas, has reported higher outbound traffic – but empty seats on flights coming into Australia – and the country's mining industry is booming.

A steady stream of Australian exporters have warned, however, that their overseas profits are dwindling. James Dominguez, chairman of the Sydney-based Australian Wine and Brandy Commission, said the cost of Australian goods abroad was having a "devastating" impact on the drinks industry.

"Of the total Australian wine crop, about two-thirds is exported and what has happened to the currency has had a huge impact, especially on lower-priced wines," he said. "It's really causing havoc with exporters."

According to Tourism Australia, 649,400 people travelled from the UK to Australia in the year to July – a drop of 1%, blamed largely on disruption caused by Iceland's volcanic ash cloud rather than on the exchange rate.

Fears are growing, however, that there will be a fall-off in visitors. One Perth-based adventure tour operator, Easyrider, ceased operations this month, blaming the soaring currency for a critical shortage of custom from British and Irish backpackerers. Owner Chris Cronin told ABC, Australia's public broadcaster, that the average number of people booking tours had fallen from 16 a bus to six or eight.

"There are a lot more people out there that are really going to suffer because of the strength of the Australian dollar at the moment," he said.

Additional reporting by Charlotte Simmonds

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